MNI POLICY: BOJ Kuroda: Japan Economy To Remain Severe

     TOKYO (MNI) - Bank of Japan Governor Haruhiko Kuroda has maintained his

cautious view that economic conditions in Japan are expected to remain severe

due to the impact of the coronavirus.

     "Looking ahead, economic activities are expected to resume but (the) severe

situation will likely continue for the time being due to the infectious

disease," Kuroda said at the opening of the quarterly branch managers' meeting

on Thursday.

     He also said the BOJ will not hesitate to take additional policy easing

measures if they are necessary to support the economy, while keeping a close eye

on the impact of the coronavirus.

     However Kuroda did not elaborate on when or how the bank would consider

additional policy easing.

     --MONETARY POLICY

     Kuroda said the BOJ continues to make efforts not only to facilitate

corporate financing but also to maintain the stability of the financial system.

     He said the BOJ will closely monitor the impact of the coronavirus and will

not hesitate to take additional easing measures if necessary. The Bank also

expects short and long-term policy interest rates to remain at their present or

lower levels.

     --JAPAN ECONOMY

     The BOJ Governor said Japan's economy remains in a severe situation but is

expected to improve due to pent-up demand, accommodative financial conditions

and the government's stimulus measures which will have an impact when the

coronavirus wanes.

     --PRICES

     Kuroda said Japan's inflation rate, measured by core CPI, is expected to

move into negative territory due to the impact of the coronavirus and the drop

in crude oil prices.

     But the inflation rate is expected to rise on the back of the improvement

in the economy, he said.

     --FINANCIAL SYSTEM

     The nation's financial system remains stable and the financial environment

continues to be accommodative, Kuroda said. 

     The degree of accommodative conditions in corporate financing, however, has

fallen.

--MNI Tokyo Bureau; tel: +81 90-2175-0040; email: hiroshi.inoue@marketnews.com

--MNI Sydney Bureau; +61 405322399; email: lachlan.colquhoun.ext@marketnews.com

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